Libyan President Muammar Gaddafi has donated millions of pounds to a "secret election campaign fund" run by President Nelson Mandela to allow the African National Congress to win the June 2 election, the British Sunday Telegraph reported on Sunday.

According to SABC radio news reports, figures compiled by Greg Mills of the South African Institute for International Affairs revealed that the ANC had received more than 112 million pounds in overseas funding from what Mills said was "questionable sources".

ANC spokesman Smuts Ngonyama dismissed the Telegraph report as a "smear campaign" against the ANC and "whoever is making the claims... has got a sinister motive".

The ANC could not say whether it had received money from Gaddafi or not, but there was nothing wrong if it had. "Like all other political parties, the ANC receives donations," Ngonyama said.

Parties such as the Democratic Party and the United Democratic Movement received funds from "countries such as the United States, but no-one has ever queried this", he said.

The Sunday Telegraph report was a "continuation of the British media trying to choose friends for the ANC", Smuts said.

“It was pure expediency to call on democratic South Africa to turn its back on Libya and Qaddafi, who had assisted us in obtaining democracy at a time when those who now made that call were the friends of the enemies of democracy in South Africa.

Had we heeded those demands, we would have betrayed the very values and attitudes that allowed us as a nation to have adversaries sitting down and negotiating in a spirit of compromise. It would have meant denying that the South African experience could be a model and example for international behaviour.

In many ways, our modest contribution to resolving the Lockerbie issue will remain a highlight of the international aspects of our Presidency. No one can deny that the friendship and trust between South Africa and Libya played a significant part in arriving at this solution. If that be so, it vindicates our view that talking to one another and searching for peaceful solutions remain the surest way to resolve differences and advance peace and progress in the world.

We look forward with joy and anticipation to the full re-entry of Libya into the affairs of our continent and the world.

We have already seen Libya take up its role as an important actor on the African continent to help advance the peace process in the Democratic Republic of the Congo.

South Africa is proud to acknowledge the coincidence between its own position and SADC's, on the one hand, and that of Libya on the other. We share the view that peace in the DRC can only be achieved through the withdrawal of all foreign forces and an inclusive political process of Congolese groups.

We appreciate very much Libya's indication that its own efforts will be co-ordinated with those of our regional organisation, SADC. This approach confounds those who suggest that Libya is less than fully committed to multilateralism. My Brother Leader is involved in the Congolese process as a facilitator of the SADC process, just as we were involved in the Lockerbie issue as facilitators for the United Nations. In such ways we advance the ideals of multilateral co-operation and discipline. And for that we thank our Brother Leader and the Libyan people.

It was with much appreciation that I received reports from my Minister of Trade and Industry about our recent trade delegation to Libya. The friendly political relations between our two countries are now being consolidated and deepened through trade. We look forward to South African companies and Libyan entities bridging our continent from North to South in concrete expressions of African unity.

My Brother Leader, I know that in the abstemious conditions of the North African desert it is not the custom to propose a toast. We are, however, overwhelmed by at last having here on this southern tip of Africa one of the revolutionary icons of our times.

I shall therefore take the liberty to invite our guests to rise and raise their glasses with me in salute to Muamar Qaddafi, our Brother Leader of the Revolution of the Libyan Jamahariya, and to growing friendship between the people of our two countries.”